Your protection when buying Financial Products

Your protection when buying Financial Products

Many pseudo financial service providers sound legit when they sell you all kinds of insurance contracts and loan facilities.  This last week it was a selling organisation by name of Mzansi Money that came to the fore.

Today we will look at the way that you should react to their and similar presentations.   Each time we fall for one of these offerings we are robbed of savings.  These savings can buy your baby a car when they graduate one day, or provide more comfort to you in your old age.

The Mzansi call centre agent nearly promised a pre-approved loan.  To qualify for the loan you had to buy an income protection policy.  The agent was asked what would happen if the loan was not approved, to which he replied, that you then at least have the insurance policy.  In this instance the sale of a product could be secured on the promise of a loan.  Continue reading “Your protection when buying Financial Products”

Tips for Christmas

Tips for Christmas.

It is hard to believe that we are one month and two weeks away from Christmas.  I really love this time of year and to see the goodwill of people, one toward the other.  Few realise the sweat that follows early in January when the credit cards had been maxed out to prove the goodwill.  Let us make this year better and financially rewarding.

Today I want to take a lighter view and look at methods of extending the goodwill without breaking the bank.

I start with a story from my own life, to prove how people appreciate it when you give of yourself; and, how to save a fortune on your budget.  Later we look at what can be done with some of that savings to make 2011 a much better year.

My mother passed away at the end of 2008.  She wanted me to take the doorstop I made for her back in 1985.  This doorstop represents the cheapest presents I ever produced and I remember the event well.  Continue reading “Tips for Christmas”

Consumer Actions

Consumer actions

A past colleague of mine had a favourite warning to ‘not accept a FREE offer as it is creating an opportunity to sell for the advertiser’.  To this we can now add the ‘low premiums’ and ‘best buys’ or ‘best brand’.

I start the illustration with a story from the handy man I employ from time to time.  In 2015 he bought an old bakkie for his business that cost R30 000 – the price for an old Nissan 1400 in good usable condition.  He insured the vehicle with Budget insurance having secured the best rate there.

At the time I warned him that he must beware that the direct insurers reflect the sum insured as ‘market value’ and that he had no guarantee that they accepted his value.  He may get far less in event of write off or theft.  In December this happened and he received a pay-out of R7 000; the value according to M&M ‘value bible’.  He had no argument and had to accept.  Even the ombudsman office would have agreed with the insurer as they were technically correct. Continue reading “Consumer Actions”

Choose a Life

Choose a Life

Don and Ros met for the first time when they went to university in the 1970’s.  They followed similar life and earning patterns but made different life choices and today, both past the age of 60, look very different.  We will contrast these two people in the choices they made and hope that some of our younger readers will learn from this and make their own best choices for their lives.

The names are fictitious but the events are real.  We will later add Rob and his life pattern to show a further contrast.

We are early in the year and an adjustment to your life choices will even have a visible effect by this year end.

Don and Ros both married within a year after completing their studies and both earned the same income level as did their newly wed wives.  Ros always was a natural saver and within five years after getting married bought his first home.  Don at this time had changed jobs and was earning more than Ros, yet could not yet afford a house. Continue reading “Choose a Life”

Hedge your bets

Hedge your bets

After watching a program on TV the other day I realised the importance of hedging your bets.  The hedging of bets I will introduce to you today is different to the way that gamblers hedge their bets but, I believe, imminently better and more secure.

The gambler will hedge his bets by, after playing horse number 1 for a win, he will also play it for a place plus play a rank outsider for a place at good odds.  The logic is that one of the results will work and at least give him his money back if number does not win.  We do not all play horses but most play the lotto – where this form of hedging does not take place.

Some very intelligent people will work out a system and play their system.  I know such a very intelligent man and he developed a pattern of pay outs on numbers on the lotto and found that when the stakes are very high, one of two systems he developed pay out.  He only plays when stakes are high and will not play every week.  He is ahead on winnings over losses. Continue reading “Hedge your bets”

Hang in there and hang on to your insurance

Keeping your short-term insurance and life policies valid is vital.

In these times of financial severity, an alarming number of people cancel their short term and life insurance policies and even their medical aid to save a bit of money. Certainly, you might save some money, but by cancelling your policies you may meet with greater risk and greater cost. Rather hang onto those policies if you can.

As a consumer, I also go through the financial upsets as the rest of South Africa.  However, my dealings with clients in need constantly remind me of the importance of staying rooted to money-savvy principles regardless of the prevailing circumstances.

Just on Monday morning, a client phoned in a panic.  He had a car accident over the weekend, but had failed to renew his car insurance earlier this year.  He had been “driving while uninsured.”

Now he wanted to know how he could minimise the financial repercussions of the accident. Continue reading “Hang in there and hang on to your insurance”

Stop believing the foolish myths about personal finances

Stop believing the foolish myths about personal finances

It is April Fool’s day and perhaps you have already been caught by a little fib.   It is so easy to fall prey to a prank or to believe in a lie, isn’t it? But generally speaking we are most foolish with money at any given time – we believe myths and tall tales surrounding finances that keep us in the fiscal gutter.
On this April Fools let me dispel some common myths that abound about personal finances and expose them for the lies and half-truths that they really are. Continue reading “Stop believing the foolish myths about personal finances”

What if I grow to be a 105?

What if I grow to be a 105?

This was the refrain from a song in the 1960’s.  It now appears in becoming a reality when Three D printing will one day soon be able to reproduce replacement organs, it is reported.  They reckon that our children may live to 140 years old.

Living too long has always been a problem for us but appears to becoming a dilemma for the future of our children.  In financial planning and retirement provision we have always had to look at balancing living to long with dying too soon.

Here is our quandary if we partially benefit from the artificially printed organs: what if I live to be a 105?

As South Africans, we have never acquired a savings culture and are one of the worst countries in the world in saving money.  So, even if we do not want to acquire the savings habit for ourselves we have a responsibility to train our children into the habit.

We currently only live for about 20 years beyond retirement and most cannot even survive that long.  How much more will our children suffer in their old age if they will live for 60 years beyond retirement?  How much more will I suffer if I do not accumulate much more than my current life pattern is indicating?

If you are over 30 and you have not started your retirement savings you are in trouble.  Short term accessible savings, that everyone insists on having, do not count!

In howtomakesense today we look at the importance of saving and starting sooner rather than later. Continue reading “What if I grow to be a 105?”

Can South Africa overcome the eternal retirement struggle?


This heading is borrowed from FIA News, a financial trade magazine, writing on the latest budget speech, national growth and retirement savings.

Many trade experts rendered an opinion, yet all of it on large and macro-economic levels – generally of little use or understanding at consumer level. In howtomakesense we always try and take the macro thoughts and bring them down to understandable household levels.

What must I do?  When do I know that I am in trouble for retirement?  Where do I save?

The harsh reality is that South Africans save less than their counterparts in other countries.  The direct result of this is that only 5% of the entire population will be in a position to retire comfortably.  The rest are thus uncomfortable in retirement and: have to become dependent on the state; move in with children; go back to work at some time; or, never stop working at all.

If you want to have the results only 5 % have, you must be willing to do and think like only 5 % do and think” Robin Sharma.  He also quotes “dream big, start small, act now” Continue reading “Can South Africa overcome the eternal retirement struggle?”

Honour the elderly within you

On Sunday I spent the day with one of my favourite cousins celebrating his birthday.  He did not want to admit to his age.   Also his wife did not want to tell me without his permission.  Later I asked him whether he was afraid of getting old and admitted he was and did not know why.old-and-young

Many suffer this fate and the best known proponent of this in South Africa was Dr Chris Barnard, the man who did the first heart transplant in the world.  At 70 he looked less than 50 and had gone in pursuit of finding eternal youth, even fathering yet another child at that age to perhaps prove the point.  He was planning to attain a breakthrough on curing old age as he was at giving people new hearts. Continue reading “Honour the elderly within you”